European Union slaps revenge tariffs on United States as trade war erupts

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European Union slapped a 25 per cent tariff on American products such as whiskey, tobacco, Harley Davidson motorcycles, cranberries and peanut butter, reports The Independent.

Late last month, Trump proceeded to infuriate USA allies - from the European Union to Canada and Mexico by imposing tariffs of 25 percent on imported steel and 10 percent on aluminum.

"We did not want to be in this position", EU Trade Commissioner Cecilia Malmstrom said in a statement, adding that the "unilateral and unjustified" U.S. decision had left the EU with no choice.

And the EU's trade chief Cecilia Malmstrom said she was "very worried" the row with Mr Trump could trigger a "full trade war".

The EU has also filed a case with the World Trade Organisation (WTO), claiming Trump's tariffs were "pure protectionist" and "illegal".

Analysts have said a Sino-U.S. trade war could disrupt supply chains for the technology and auto industries - sectors heavily reliant on outsourced components such as those supplied by Foxconn - and derail growth for the global economy.

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From blue jeans to motorbikes and whiskey, the EU's hit-list of products targeted for tariffs with the USA reads like a long list of emblematic American exports. Trump has threatened to impose new taxes on European and other imported cars - an idea that caught many by surprise, because domestic automakers GM and Ford have been thriving, and foreign companies such as BMW, Toyota and Honda now have large plants in the U.S.

Brussels first drew up the list in March when US President Donald Trump initially floated the idea of 25 percent tariffs on steel imports and 10 percent on aluminium.

"The rules of global trade that we have developed over the years with our American partners can not be violated without a reaction from our side", Malmstrom said. "Needless to say, if the US removes its tariffs, our measures will also be removed". That comes after the USA put a 25 percent tariff on $34 billion of Chinese goods, to which Beijing responded by imposing an identical charge on the same amount of American goods. Mexico retaliated against the move two weeks ago while Canada said it would place tariffs on U-S exports from July the first. India and Turkey have already targeted U.S. products, ranging from rice to autos to sunscreen. "How they'll take it, we'll have to wait and see".

The world's most-powerful central bankers this week warned that escalating worldwide trade tensions have started damaging confidence among companies, threatening the global economic expansion.

Mr Trump ran for the presidency on a vow to topple seven decades of American policy that had favoured ever-freer trade among nations.

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